Microsoft acquires Nokia for £4.4bn: Stephen Elop to take central management role

In a move to secure a future in the mobile market, Microsoft has completed its acquisition of Nokia's handset division.

With the deal eventually inked at slightly over the agreed €5.4 billion (£4.4bn), Microsoft acquires a company that has struggled in recent times against fierce competition from rivals Samsung and Apple.

Nokia has not revealed the exact amount settled on, but has said how factories in India and Korea will not change hands as part of the deal.

Microsoft has its sights on the £30 million-a-year affordable mobile devices market, wherein it will deliver "the first mobile experience to the next billion people while introducing Microsoft services to new customers around the world."

Chief executive of Microsoft, Satya Nadella, said, "The mobile capabilities and assets they bring will advance our transformation. Together with our partners, we remain focused on delivering innovation more rapidly in our mobile-first, cloud-first world."

25,000 Nokia staff come as part of the deal, plus Nokia chief executive, and former Microsoft executive, Stephen Elop.

Elop will take on the role of executive vice-president of Microsoft Devices, managing Xbox hardware, the Surface Tablet, mobile phones, and smartphones and tablets from the Lumia range.

Nokia holds a board meeting next Tuesday, where it will clarify its strategy moving forward and sign off its plans. It remains to be seen how the mapping, patents and research and development parts of the business will fit around the core telecoms equipment operations, to be led by head of networks, Rajeev Suri.

Elop himself was removed from the talks to prevent distasteful external reactions. Some have suspected the iPhone-throwing former Nokia CEO of being part of a long-term plan by Microsoft to buy an ailing handset business.

Nokia had struggled in the smartphone market due to a crucial misdirection around 2007, when software developers started to outstrip the hardware vendors. A tie to Microsoft's Windows phone in 2011 did little to reverse fortunes as Asian competitors encroached upon the mid-price segment "feature" phone market once dominated by the Finnish firm.